For the first time in Kenya’s entire history, it would be shipping oil out to other countries. With its current GDP of $74.94 billion, a population of 49.7 million and a 2017 GDP per capita of over $1500, Kenya is gradually coming back as a force to reckon with in Africa. Uhuru Kenyatta, Kenya’s President has just flagged off Kenya’s maiden crude oil export with a warning against corruption that may deny people the opportunity to benefit from the resource.
Here Is All You Need To Know
- The crude oil will be shipped by Chinese state-owned firm ChemChina which won the tender to buy the maiden Kenyan oil at a premium early this month.
- Mv Celsius Riga will deliver the Sh1.2b consignment Malaysia.
- On August 1 the Government announced that the oil produced in Turkana and stock it at the Kenya Petroleum Refineries Ltd’s (KPRL) storage facilities in Mombasa would be sold at Sh1.2 billion ($12 million).
- This deal which is the first-ever in the whole of Kenya’s history saw Kenya selling off 200,000 barrels of oil at a price of Sh1.2 billion ($12m).
- Kenya discovered commercial oil reserves in its Lokichar basin in 2012 and Tullow Oil estimates the basin to contain an estimated 560 million barrels in so-called 2C proven and probable oil reserves.
- Tullow has said this would translate to 60,000 to 100,000 barrels per day of gross production.
- Tullow Oil is a multinational oil and gas exploration company founded in Tullow, Ireland with its headquarters in London, United Kingdom. It has interests in over 150 licenses across 25 countries with 67 producing fields and in 2012 produced on average 79,200 barrels of oil equivalent per day.
- The government and Tullow Oil had expected to start exporting crude under the Early Oil Pilot Scheme (EOPS) by June this year but that appeared unlikely with the company only having trucked about half of the amount that will be needed for the first shipment.
- In May, Kenya’s Ministry of Petroleum said about 88,000 barrels of oil had so far been trucked to Mombasa and was targeting to accumulate 200,000 barrels that would form the first export cargo.
- The oil that has been ferried to Mombasa was produced in 2015 during an extended well testing exercise. By end of March, Tullow had shipped all the oil stored in Lokichar and has been setting up an Early Production Facility, which will produce 2,000 barrels a day.
Currently, major oil producers in Africa include Nigeria (0.0449), Libya (0.0101), Egypt (0.0418) and Algeria (0.0913), producing a total of 0.1881 trillion cubic feet of gas cumulatively which is 5.4 percent of the world’s total production.
In 2018, Africa’s total oil production amounted to around 8.19 million barrels of oil per day.
Africa’s production rate is, however, decreasing at a rate of 1.1 percent per annum. Africa’s consumption rate is at 138.2 billion cubic meters at a growth rate of 1.4 percent. It would take Africa 68 years to completely deplete its reserves.
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world.